Arvind Krishna, the CEO of IBM, is a strong proponent of increasing federal funding for research and development (R&D) in artificial intelligence (AI) and other related technologies. In a recent interview with TechCrunch, Krishna stated that both he and IBM firmly believe that federal R&D support should be enhanced, particularly in the face of substantial budget cuts proposed by the Trump administration.
The Trump administration’s budget reductions have significantly impacted the Directorate for Technology, Innovation, and Partnerships (TIP), a key federal AI research office, resulting in job losses for many employees at the National Institute of Standards and Technology and the National Science Foundation (NSF). These cuts pose a threat not only to ongoing AI projects but also to future advancements in technology vital to the nation’s competitiveness and growth.
President Trump has also aimed to reduce NSF funding by more than half, labelling it as wasteful. These reductions jeopardise billions in federal support for AI R&D, affecting various agencies, including the National Institutes of Health and the Department of Energy. Additionally, plans to terminate the CHIPS Act, which is designed to boost domestic semiconductor manufacturing, have surfaced, partly due to staffing reductions in the office managing these funds.
Industry groups, including the Software and Information Industry Association, have raised concerns that these financial cuts could undermine America’s global leadership in AI. Research shows that federally funded initiatives yield remarkable returns of 25-40%, outpacing the returns of venture capital funds.
Krishna emphasized the importance of federal funding, stating that current levels are historically low as a percentage of GDP. He argued that increased federal R&D investment has a significantly positive impact on economic growth and competitiveness, as well as on essential future technologies.
IBM has already felt the repercussions of these federal cutbacks, having seen 15 federal contracts worth approximately $100 million canceled in the first quarter of the year. While federal contracts contribute between 5% and 10% to IBM’s consulting business, Krishna expressed optimism that government R&D spending will improve within the next year across critical areas like AI, quantum computing, and semiconductors.
“I anticipate that in a year, federally funded R&D for AI and other sectors will be in a better state than currently,” he concluded, reaffirming his commitment to advocating for increased federal support in technology research and development.
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